During Bill Clinton's 1992 presidential election campaign, his strategists famously reminded the electorate that the "economy" was top priority for voters. Two administrations later, the construction industry again faces dire economic conditions impacting every business decision they make.

When it comes to the fleet management process - whether it's equipment selection and acquisition, application, maintenance, or capital equipment tax considerations - business owners are boring down into every aspect to make sure they are keeping their businesses safe and profitable during what is expected by all to be a very tough 2009.

For those with on- and off-road fleets, this is an opportune time to compare the cost of ownership including management time spent dealing with fleet maintenance, legalization, record keeping, etc. with alternative programs including full service leasing.

Financing Problems
The conundrum of whether to lease vs. own has been facing business owners for as long as the leasing concept has been around. Full service combines financing and services offering economies of scale with single vendor sourcing. The number one reason people are considering leasing today is that it's an alternative form of financing the equipment they need. With capital being a limited resource, the investment needed for new equipment is huge. In this tight credit market, prospective lessees can turn to full service companies as an alternative to traditional lending sources.

The leasing entity makes the investment for the equipment, leaving the lessee off the hook if there are market fluctuations affecting the residual value of the equipment as it ages and depreciates. For example, if a tractor costs $85,000 to purchase, and the equipment is set up on the tax books to depreciate over a period of seven years down to a value of $35,000, the owner of the equipment must be able to clear a value of $35,000 off of the tax books by year eight.